Gap Inc. Reports January Sales and Strong Fourth Quarter Results

  Gap Inc. Reports January Sales and Strong Fourth Quarter Results

     Guides to Fourth Quarter Earnings per Share Range of $0.70 to $0.71

Business Wire

SAN FRANCISCO -- February 7, 2013

Gap Inc. (NYSE: GPS) today reported that January 2013 net sales for the
five-week period ended February 2, 2013 were $1.13 billion compared with net
sales of $833 million for the four-week period ended January 28, 2012. The
company’s comparable sales for January 2013 were up 8 percent compared with a
4 percent decrease for January 2012.

In addition, the company reported that net sales for the fourth quarter of
fiscal year 2012, which ended February 2, 2013, were $4.73 billion compared
with $4.28 billion for the fourth quarter last year. The company’s comparable
sales for the fourth quarter of fiscal year 2012 were up 5 percent compared
with a 4 percent decrease in the fourth quarter last year.

The company noted that fiscal year 2012 had 53 weeks versus 52 weeks in fiscal
year 2011. As a result, net sales for January 2013, the fourth quarter of
fiscal year 2012, and fiscal year 2012 include the additional week, while
comparable sales exclude the 53^rd week.

“We’re pleased with the continued momentum in the business across all our
brands in North America,” said Glenn Murphy, chairman and chief executive
officer of Gap Inc. “As we transition to 2013, our focus remains on delivering
compelling product in order to sustain our positive sales performance.”

January Comparable Sales Results

Comparable sales for January 2013 were as follows:

  *Gap North America: positive 8 percent versus negative 5 percent last year
  *Banana Republic North America: positive 8 percent versus positive 6
    percent last year
  *Old Navy North America: positive 12 percent versus negative 6 percent last
    year
  *International: positive 1 percent versus negative 10 percent last year

Fourth Quarter Comparable Sales Results

Comparable sales for the fourth quarter of fiscal year 2012 were as follows:

  *Gap North America: positive 4 percent versus negative 3 percent last year
  *Banana Republic North America: positive 3 percent versus flat last year
  *Old Navy North America: positive 8 percent versus negative 6 percent last
    year
  *International: negative 2 percent versus negative 8 percent last year

Fourth Quarter Guidance

The company announced diluted earnings per share guidance for the fourth
quarter of fiscal year 2012 to be in the range of $0.70 to $0.71. In addition,
the company now expects year-end inventory dollars per store to be slightly
above previous guidance driven by higher in-transit inventory given the
earlier Easter holiday in 2013.

Fiscal Year 2012 Sales Results

Net sales were $15.65 billion for the 53 weeks ended February 2, 2013 compared
with net sales of $14.55 billion for the 52 weeks ended January 28, 2012. The
company’s comparable sales for fiscal year 2012 increased 5 percent compared
with a 4 percent decrease last year.

Monthly Sales Communications

As part of Gap Inc.’s ongoing commitment to provide frequent and transparent
financial information, the company today announced plans to continue monthly
sales reporting. Monthly sales results will continue to be released on the
Thursday following the end of each fiscal month; however, beginning with
February 2013 sales, results will be released via press release after market
close at 1:00 p.m. Pacific Time. In addition, beginning with February 2013
sales, the company will reintroduce a pre-recorded message as a supplement to
the press release.

Given Gap Inc.’s new global brands structure, the company will shift from its
current reporting format of Gap Inc., Gap North America, Banana Republic North
America, Old Navy North America, and International comparable sales results to
the following format: Gap Inc., Gap Global, Banana Republic Global and Old
Navy Global. Each global brand’s comparable sales results will now include the
respective International results, in addition to the associated comparable
online and outlet sales.

Fourth Quarter Earnings and February Sales Announcements

Gap Inc. will release its fourth quarter earnings results via press release on
February 28, 2013 at 1:00 p.m. Pacific Time. In addition, the company will
host a summary of Gap Inc.’s fourth quarter results during a live conference
call and webcast on February 28, 2013 at approximately 2:00 p.m. Pacific Time.
The conference call can be accessed by calling 1-855-5000-GPS or
1-855-500-0477 (participant passcode: 2364809). International callers may dial
913-643-0954. The webcast can be accessed at www.gapinc.com.

The company will release February sales via press release on March 7, 2013 at
1:00 p.m. Pacific Time. Beginning with February 2013 sales, additional insight
into Gap Inc.’s sales performance can be obtained by calling 1-800-GAP-NEWS
(1-800-427-6397). International callers may call 706-902-4949. The recording
will be available at approximately 1:00 p.m. Pacific Time on March 7, 2013 and
available for replay until 1:00 p.m. Pacific Time on March 15, 2013.

Forward-Looking Statements

This press release contains forward-looking statements within the “safe
harbor” provisions of the Private Securities Litigation Reform Act of 1995.
All statements other than those that are purely historical are forward-looking
statements. Words such as “expect,” “anticipate,” “believe,” “estimate,”
“intend,” “plan,” “project,” and similar expressions also identify
forward-looking statements. Forward-looking statements include statements
regarding the following:

  *sustaining positive sales performance;
  *earnings per share for the fourth quarter of fiscal year 2012; and
  *year-end inventory dollars per store.

Because these forward-looking statements involve risks and uncertainties,
there are important factors that could cause the company’s actual results to
differ materially from those in the forward-looking statements. These factors
include, without limitation, the following:

  *the risk that additional information may arise during the company’s close
    process or as a result of subsequent events that would require the company
    to make adjustments to the financial information;
  *the risk that changes in general economic conditions or consumer spending
    patterns could adversely impact the company’s results of operations;

  *the highly competitive nature of the company’s business in the United
    States and internationally;
  *the risk that the company or its franchisees will be unsuccessful in
    gauging apparel trends and changing consumer preferences;
  *the risk that natural disasters, public health crises, political crises,
    or other catastrophic events could adversely affect the company’s
    operations and financial results; and
  *the risk that acts or omissions by the company’s third-party vendors,
    including a failure to comply with the company’s code of vendor conduct,
    could have a negative impact on its reputation or operations.

Additional information regarding factors that could cause results to differ
can be found in the company’s Annual Report on Form 10-K for the fiscal year
ended January 28, 2012, as well as the company’s subsequent filings with the
Securities and Exchange Commission.

These forward-looking statements are based on information as of February 7,
2013. The company assumes no obligation to publicly update or revise its
forward-looking statements even if experience or future changes make it clear
that any projected results expressed or implied therein will not be realized.

About Gap Inc.

Gap Inc. is a leading global specialty retailer offering clothing,
accessories, and personal care products for men, women, children, and babies
under the Gap, Banana Republic, Old Navy, Piperlime, Athleta, and Intermix
brands. Fiscal year 2012 net sales were $15.7 billion. Gap Inc. products are
available for purchase in about 90 countries worldwide through about 3,000
company-operated stores, over 300 franchise stores, and e-commerce sites. For
more information, please visit www.gapinc.com.

Contact:

Gap Inc.
Investor Relations Contact:
Katrina O'Connell, (415) 427-2832
Investor_relations@gap.com
or
Media Relations Contact:
Emily Russel, (415) 427-6230
press@gap.com
 
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